Gordon's Digital Industry Initiative # 8 - Catch 22

With the Digital Britain Report out today hopes are high that innovation will be critical to success. However, many new ideas come from small to medium-sized companies and there’s the rub. Major corporations, especially local and central government, are precluded from dealing with small organisation by procurement restrictions. It’s Catch 22.

For SMEs to grow they need contracts with substantial organisations. The joke is that while many of the companies winning tenders have the balance sheet to meet procurement criteria, they don’t have the muscle or skill to fulfill the order. To do so they subcontract out to smaller businesses to supply the deliverables. 

So what’s wrong with that as SMEs get some business out of it – well the principal siphons off the cream to pay it’s shareholders, leaving the subby on skimmed milk with no fat to nurture its R&D function. It’s a win-loose situation. 

Coming to the aid of innovative SMEs working in the security sector is former CW Editor-in- Chief,  Dr John Riley. Co-founder of Innovation Initiative  an advisory panel that is trying to link IT security innovators with corporates seeking to reduce business risk.